In the event that the Korean Maritime Union purchases real estate under the name of an incorporated marine hospital to establish and operate a hospital for its members, whether the disposition of imposing local taxes on the corporation is appropriate;

In order to establish and operate a hospital as a medical benefit measure for its members, and to use the real estate in the name of the plaintiff corporation for convenience, the acquisition of the real estate shall not be for the purpose of direct use in the business of the above corporation, and therefore, it shall not be subject to the tax exemption under Article 107 subparagraph 1 of the Local Tax Act.

Article 107 subparagraph 1 of the Local Tax Act

Attorney Choi Han-su et al., Counsel for the defendant-appellant

Attorney Jung-gu et al., Counsel for the defendant-appellant

Daegu High Court Decision 85Gu19 delivered on June 14, 1985

The appeal is dismissed.

The costs of appeal are assessed against the plaintiff.

The Plaintiff’s attorney’s ground of appeal is examined.

Article 107 subparagraph 1 of the Local Tax Act does not stipulate all the cases of acquisition by a non-profit entrepreneur for religious, religious, charity, academic, art, or other public interest as prescribed by the Presidential Decree as non-taxation, but it is clear that the above non-profit entrepreneur is subject to non-taxation only in the case of acquisition for direct use in the business. Therefore, even if the plaintiff corporation falls under a non-profit corporation prescribed by the illegal provision, such as the theory of lawsuit, even if it falls under the non-profit corporation prescribed by the illegal provision, it shall not be subject to non-taxation.

According to the facts established by the court below and the plaintiff's assertion, the real estate at Won-si was purchased in the name of the plaintiff for the purpose of establishing and operating the hospital as a measure for medical benefits for its members and using it. If the facts are the same, the acquisition of the real estate in the judgment shall not be directly used for the business of the plaintiff corporation. Therefore, the acquisition of the real estate in the judgment of the court below shall not be subject to non-taxation under Article 107 (1) of the Local Tax Act. Thus, the acquisition of the real estate in the judgment of the court below is subject to taxation of acquisition tax, and there is no error of law

In addition, as long as the plaintiff corporation did not acquire real estate for its own business purposes, there is no room for doubt that there was a legitimate reason that it did not use it directly for its own business purposes within one year. Thus, the judgment of the court below which rejected the plaintiff's assertion that it did not apply the heavy tax rate under Article 112 (2) of the Local Tax Act on the land among the real estate at the time of original purchase on the ground that there was a justifiable reason that it did not directly use it for its own business purposes, is just and there

Ultimately, the appeal is dismissed, and all costs of appeal are assessed against the losing party. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Yoon Il-young (Presiding Justice) Gangwon-young Kim Young-ju